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Antitrust and competition – the EU weekly briefing (29 June 2015)

General Court dismisses request for interim measures relating to inspections in the oil, biofuel, and bioethanol markets. On 16 June 2015, the General Court dismissed an application by Algocroup and Alcodis for interim measures in their appeal against two European Commission (Commission) decisions ordering inspections. The applicants claim that the Commission wrongly took legally privileged documents during the inspections. The applicants sought interim relief to suspend the Commission’s investigations and prevent the use of the documents. The General Court found that the application for interim measures is inadmissible. In particular, the General Court considered that the applicants had not established that interim measures were necessary in this case to ensure the implementation of any General Court judgment annulling the contested decisions.

Commission market­tests commitments offered by Bulgarian Energy Holding (BEH) in relation to suspected abuse of dominance on wholesale electricity market. On 19 June 2015, the Commission announced that it is market­testing commitments offered by BEH, under Article 9 of Regulation 1/2003, to address competition concerns in relation to its behaviour on the non­regulated wholesale electricity market in Bulgaria. BEH made commitments to alleviate the Commission’s concerns that BEH has been preventing competition on the non­regulated wholesale electricity market in Bulgaria. BEH’s proposed commitments include establishing a power exchange in Bulgaria, and ensuring that sufficient volumes of electricity are offered on an auction­based day­ahead trading platform on that exchange.

EU Cartels

Advocate General Opinion on Toshiba appeal against General Court ruling on the power transformers cartel. On 25 June 2015, Advocate General Wathelet Opined on an appeal by Toshiba Corporation against a General Court judgment dismissing its action against the Commission’s decision on the cartel for power transformers. The Advocate General proposed that the Court of Justice of the European Union (CJEU) should dismiss Toshiba’s appeal. In particular, the Advocate General dismissed Toshiba’s submission that the General Court should have verified whether the Japanese producers had real possibilities to enter the EEA market and whether this was economically viable on the basis that this would impose stricter evidential requirements and would be contrary to CJEU case law.

Commission fines participants in retail food packaging cartels. On 24 June 2015, the Commission announced that it had fined eight manufacturers and two distributors of polystyrene foam and polypropylene rigid trays used for packaging food a total of EUR 115,865,000 for having participated in at least one of five separate cartels. The Commission found that each of the cartels covered a different European region, which together included most EU member states. With some variations between the cartels, the relevant companies co­ordinated prices, allocated customers and markets, co­ordinated their bids for tenders, and exchanged commercially­sensitive information.

Commission sends Statement of Objections to suspected participants in car battery recycling cartel. On 24 June 2015, the Commission announced that it has sent a Statement of Objections to five lead recycling companies suspected of participating in an illegal purchasing cartel for scrap lead­acid batteries. The Statement of Objections sets out the Commission’s suspicions that between 2009 and 2012, these companies participated in a cartel aimed at fixing the purchase prices in Belgium, France, Germany, and the Netherlands, in breach of Article 101 of the Treaty of the Functioning of the European Union. The Commission alleges that the companies agreed or co­ordinated their behaviour to maintain higher profit margins. As a result, they may have lowered the prices paid to scrap dealers, many of which are small and medium­ sized enterprises. As such, behaviour would be likely to reduce the value of used batteries sold for scrap, which could ultimately be to the detriment of such sellers.

EU Competition Procedure

CJEU appeals General Court order in Aalberts Industries NV’s (Aalberts) damages action for excessively long court proceedings. On 22 June 2015, details were published of an action brought by the CJEU against a General Court order dismissing an application lodged by the CJEU seeking a declaration of inadmissibility in respect of Aalberts action claiming damages for harm suffered as a result of delay by the European Courts in adjudicating its appeal against the cartel for copper fittings. Aalberts’ action was brought against the Commission and CJEU. In February 2015, the General Court ruled that it was for the CJEU to represent the EU in the action, accepting only the Commission’s plea that the action in so far as it was brought against it as the representative of the European Union was inadmissible.

General Court partially upholds appeal against Commission decision ordering partial recovery of state aid granted to short­term export­credit insurance company. On 25 June 2015, the General Court handed down a judgment on an appeal by SACE SpA and its

subsidiary, SACE BT SpA, a short­term export­credit insurance company, against a Commission decision ordering Italy to obtain partial recovery of state aid granted to SACE BT. The Commission had found that capital injections made by SACE BT’s state­owned parent company and reinsurance coverage provided by SACE SpA constituted unlawful state aid and should be recovered. The General Court upheld the Commission’s conclusion that the reinsurance measure provided an advantage to SACE BT corresponding to the difference between the fee actually paid by SACE BT and the fee that a private reinsurer would have requested given the higher level of risk assumed. However, the General Court accepted the applicants’ argument that the Commission had failed to provide sufficient reasoning as to why the amount of the commission paid to SACE SpA should have been at least 10% higher than that of the commission applied by private reinsurers in relation to the smaller portion of reinsurance and risk assumed by them.

UK High Court rules no state aid involved in new private copying exception. On 19 June 2015, the High Court ruled that there is no state aid involved in the introduction (without a compensation scheme) of a new exception to copyright rules for personal copies for private use (section 28B, Copyright, Designs and Patents Act 1998). This ruling was made in the context of a broader judicial review application brought by the British Academy of Songwriters Composers and Authors together with others. It was argued that the new exception to copyright rules gives an advantage to companies in the technology sector, constituting illegal, unnotified state aid. The High Court held that the alleged link between the advantage conferred on the technology providers and the foregoing of revenues by the state is far too remote, indirect, and informal for it to amount to aid through state resources.

UK Cartels

Competition and Markets Authority (CMA) announces acquittal of two individuals following criminal trial in galvanised steel water storage tank cartel case. On 24 June 2015, the CMA announced that Clive Dean and Nicholas Stringer have been acquitted of charges under section 188 of the Enterprise Act 2002 (the criminal cartel offence) following a trial at Southwark Crown Court. The two men had been charged with dishonestly agreeing with others to divide customers, fix prices, and rig bids in respect of the supply in the UK of galvanised steel tanks for water storage. The CMA states that it accepts that in this case the jury was not persuaded that Mr Stringer and Mr Dean acted dishonestly.

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